Incumbents’ Capabilities for Sustainability-Oriented Innovation in the Norwegian Food Sector—an Integrated Framework

Abstract

The urgency of sustainability transition requires large incumbents in the food industry to implement sustainability-oriented innovation (SOI). However, the high concentration of the food sector and the complexity of the sustainability concept make its understanding and overall transition challenging and slow. Incumbents would need to drive the transition by redesigning business models and practices and acquiring new competencies to integrate sustainability into their innovation strategy. This paper has a twofold aim: (I) analyzing the evolution of sustainability understanding over time and (II) evaluating the extent of dynamic capabilities of food incumbents to foster SOI. We developed an integrated theoretical framework combining the theory of dynamic capabilities with aspects of SOI and applied it to the case of the Norwegian food industry. We interviewed eight food incumbents and one food industry association, and we reviewed their annual and sustainability reports from 2016 till 2020. Key findings show a high strategic activity in SOI, as well as a notable and industry-wide ambiguity about what sustainability means in the food sector. Most companies reveal both an adaptive and expanding behavior implementing conscious sustainability-integrated product and process innovations. Most innovations are incremental without a radical modification of business models. Some exceptions have been detected resembling transformative changes. Clear initiatives of moving away from a linear supply chain to a more systematic approach are currently happening through food system collaborations.

Agrifood Sustainability Transitions in Firms and Industry: A Bibliographic Analysis of Research Themes

“…Furthermore, rather than the transformation of the regime, the established food system may assimilate certain aspects of the alternative food systems without there being a fundamental transformation. For example, supermarkets may offer local produce, organic, fair trade and vegan options as a part of their product offering, co-existing with conventional products (Aschemann-Witzel et al, 2023;Audet et al, 2017;Bui et al, 2019;Davidson et al, 2016;Gonera et al, 2023;Marletto & Sillig, 2019;Ribeiro & Turner, 2021). Additionally, the role of the regime is acknowledged in the transformation process (Aschemann-Witzel et al, 2023;Gonera et al, 2023;Kuokkanen et al, 2018).…”

“…For example, supermarkets may offer local produce, organic, fair trade and vegan options as a part of their product offering, co-existing with conventional products (Aschemann-Witzel et al, 2023;Audet et al, 2017;Bui et al, 2019;Davidson et al, 2016;Gonera et al, 2023;Marletto & Sillig, 2019;Ribeiro & Turner, 2021). Additionally, the role of the regime is acknowledged in the transformation process (Aschemann-Witzel et al, 2023;Gonera et al, 2023;Kuokkanen et al, 2018). There is evidence that incumbent firms are incorporating sustainability priorities in their vision, goals and practices often driven by regulations or pressure from shareholders, customers and consumers (Bulah et al, 2023).…”

“…There is evidence that incumbent firms are incorporating sustainability priorities in their vision, goals and practices often driven by regulations or pressure from shareholders, customers and consumers (Bulah et al, 2023). In this way, incumbent agrifood firms and industries can become a positive force for food system sustainability (Bulah et al, 2023;Gonera et al, 2023). The literature in this cluster acknowledges that there are multiple perspectives on what transformation may look like and what problems need to be addressed (Kuokkanen et al, 2018;Wojtynia et al, 2021).…”